Concerns about weak oil demand in Asia and China in particular as well as plans by OPEC+ producers to unwind supply cuts are set to dominate discussions at the region’s largest annual gathering of energy traders next week.
APPEC 2024, organized by S&P Global Commodity Insights, starts on Monday in Singapore and is set to include more than 1,000 participants from over 50 countries to discuss the outlook for oil and gas supply, demand and prices.
It takes place against a backdrop of falling global oil prices, despite fears of escalating tensions in the Middle East, weighed down by worries over slowing global economic growth and oil demand from the world’s two biggest consumers – China and the U.S.
This week, Asian refiners’ margins slumped to their lowest seasonal levels since 2020 as supplies of diesel and gasoline rose after peak summer travel demand ended, triggering expectations of run cuts in the region.
“The biggest talking point is going to be demand,” said Amrita Sen, founder and director of research at consultancy Energy Aspects.
“China is going to be a huge focus.”
Brent crude futures slipped toward $70 a barrel this week despite production outages in Libya and a two-month delay by OPEC+ to start unwinding supply cuts.
“Right now, 2025 year-on-year supply growth from outside OPEC+ equals demand growth. So there is no room to unwind cuts without flipping the market into surplus,” Saul Kavonic, an energy analyst at MST Marquee.
“This also means any further demand weakness will require OPEC+ to cut deeper from already record low production target levels.”
The upcoming U.S. election will also be a key topic at APPEC, analysts say.
“I think it is widely accepted that Trump would be more bearish for oil. But let’s not forget he is more likely to take a hawkish view against Iran,” said Warren Patterson, head of global commodities research at ING.
“So the potential for stricter enforcement of sanctions (on Iran). That could change the balance quite drastically for next year.”
Meanwhile, strength in Brent and U.S. West Texas Intermediate crude benchmarks against Middle East’s Dubai have caught traders by surprise, Energy Aspect’s Sen said.
“This year, Eastern traders haven’t made money, so I think that’s going to be an interesting one,” she added.